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Labour Inspectorate can now initiate insolvency proceedings

Non-payment of remuneration under an employment agreement can now trigger insolvency proceedings in Bulgaria

From 31 March 2018, Bulgaria’s General Labour Inspectorate will be empowered to file an application to open insolvency proceedings. So far, the right to initiate insolvency proceedings was limited to a debtor in person, his liquidator, a creditor under a commercial transaction or the National Revenue Agency (for public obligations to the state or to municipalities).

The General Labour Inspectorate will be able to apply to open insolvency proceedings against a merchant with an outstanding obligation to pay remuneration under an employment agreement. Payment must be due for at least two months and affect no less than one-third of employees.

In this case, it is likely that the Inspectorate will strengthen its control over compliance with Bulgarian labour legislation, placing predominant emphasis on timely payment of employee remuneration by employers.

Source: Labour Code, Commerce Act (State Gazette, issue No 102/22.12.2017)

 

 

 

 

 

 

 

 

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